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2016 (7) TMI 1304 - AT - Income TaxBogus purchases - purchases made by the assessee from three parties appearing in the sales tax hawala list - Held that:- Merely on the basis of information from sales tax department, the AO has treated the purchases as bogus without making any independent enquiry. As found that assessee had shown net profit of ₹ 13,85,827/- on the sales of ₹ 5.29 crores. However, the AO has declined the corresponding sales made by the assessee, nor rejected assessee’s books of accouns. Keeping view judicial pronouncements referred by the AR in the case of Ganpatraj A Sanghvi [2014 (11) TMI 295 - ITAT MUMBAI] and also considering the net profit rate shown by the assessee, we restrict the disallowance/addition to the extent of 5% of the bogus purchases so made by assessee. - Decided partly in favour of assessee.
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